Lenders Used Aid To Repay TARP

Small businesses are often the driving force of the economy. The government acknowledges this and created a program that permitted small banks to lend money to banks. More than half of the banks participating in the small-business lending program have spent half of the funds allocated to the program. Funds borrowed from it are used to repay the Troubled Asset Relief Program (TARP) that was established in 2008. Just like other programs that have been established, critics claim that this program decreases banks’ loan obligations too easily. The chairman of small-business committee, Representative Sam Graves also points out that the programs may not be able to increase lending and stimulate the economy at the same time. The nature of TARP has also changed over time. Originally, small-business funds were used to relieve banks from TARP. However, now, programs are used to increase lending.

The Obama administration claims that TARP banks have helped increased small business lending and exceeded the Congress’ expectations. The different opinions about various relief programs established for banks and small businesses have made it difficult for Congress to estimate the amount of money it would take to reduce most loans. The current projection is $37.93 billion.


Written By: Melody Mark


Sparshott, Jeffrey. “Lenders Used Aid To Repay TARP.” Wall Street Journal. Dow Jones & Company, 9 Apr. 2013. Web. 10 Apr. 2013.

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